Labour to give manifesto pledge not to increase VAT

The Labour Party has promised not to increase VAT if elected. The Shadow Chancellor Ed Balls says the Labour general election manifesto will contain a pledge not to increase VAT.

It says increases in the tax hit the poor and pensioners hardest.

The Liberal Democrats say their deficit reduction plans would not require an increase in VAT, with planned tax rises focused on the wealthy.

VAT was increased from 17.5% to 20% in Chancellor George Osborne’s first Budget in 2010.

In a speech in Birmingham on Tuesday, Mr Balls will say: “The next Labour government will not raise VAT. We will not put up VAT. And we will not extend it to food, children’s clothes, books, newspapers and public transport fares.

“We will not raise VAT because it’s the tax that hits everyone. It’s the tax that hits you every day. And it hits pensioners and the poorest hardest.”

In last week’s Budget, Labour leader Ed Miliband claimed the Conservatives would be forced to increase the tax because they would not be able to deliver their planned “colossal cuts”.

The Conservatives say Labour is likely to increase income tax or national insurance after the election.